BGE problem with speech bubbles
To get the object to appear above the character, the simplest way is to just move the speech bubble mesh above the origin in edit mode.

To rotate the speech bubble, use the Track To Actuator to make sure the object is always facing the camera.



Or, even easier,

Under material settings, set the speech bubble to 'billboard', this way, it will always point at the camera automatically. You'll need to make sure the normal of the mesh is pointing at the +X axis of the world for it to appear correctly.